Judge asks why Microsoft hasn't sold more licences

A judge has asked the US Department of Justice to investigate why only nine companies have signed up to license Microsoft's...

A judge has asked the US Department of Justice to investigate why only nine companies have signed up to license Microsoft's technology for their own software products, an offering forming part of the federal antitrust settlement with the software company.

During an antitrust settlement oversight hearing Friday, Judge Colleen Kollar-Kotelly questioned why more companies hadn't taken advantage of the licensing portion of the antitrust settlement, approved by Kollar-Kotelly in late 2002.

Kollar-Kotelly has asked the DOJ to interview software companies to see if changes are needed in the licensing terms in the antitrust settlement. In a July hearing, Kollar-Kotelly said new licensing terms that Microsoft would later announce should satisfy concerns over royalty rates Microsoft was charging for its communications protocols.

Microsoft previously agreed to reduce an advance payment for licences from $100,000 to $50,000, and to require royalties of 1% to 5% of the revenue from any products that use the protocols.

A representative of the DOJ was unavailable to comment on the judge's request, but Microsoft spokesman Jim Desler said his company looks forward to any findings after the DOJ talks to software sellers.

Kollar-Kotelly has scheduled another antitrust settlement compliance hearing for January.

In a status report released last week, the DOJ noted that Microsoft has made "limited" progress in obtaining more licences. But the DOJ report did not ask the judge take any specific action right now, instead suggesting that "further steps may need to be taken in order to effectuate the goals of the remedy".

Microsoft defended its progress, claiming that it was talking to almost 40 suppliers about licensing its technology. The progress from four to nine licensees in three months shows a large effort on Microsoft's part, Desler insisted.

"We've taken some aggressive steps in terms of promoting this program and in terms of educating the industry about it," Desler added. "We've more than doubled the number of licensees we have in three months. This does show some momentum, but this is still a work in progress."

Some companies' software may be able to interoperate with Microsoft products, making the licences unnecessary.  "I think the judge wanted to know whether or not [the number of licences] is due to the terms and conditions of the licensing programme or whether it is due to a lack of interest on some parties," he said. "This is just simply a natural part of the compliance process."

Asked if Microsoft would support further revamping of the licensing terms, Desler would not commit to more changes. "I think we just take this whole process step by step," he said.

"The next step is for the Department of Justice to talk with industry and report back on what they've learned."

Grant Gross writes for IDG News Service

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